BMN - Bannerman Energy

[shag]

smells like it was rushed to me, like when they talk of resource upgrade they talk only of new anomalies. why not say we havn't factored in the likely hot sediment material yet. for all we know its leached right to china from this much awaited report.
they must have a pretty good feel of whats at least down there by now.
i guess wait till later this year for more news.
ps its neighbour has done well today, up 6% odd.
cheers

 

[kariba]

The scoping study was supposed to start the fire under the SP it hasnt and it is drifting back toward the $2.25 level of a few days ago. Now you cannot tell me that you are not dissappointed with that.

LOL

Daz, your expectations are way too high!!! IMO it did start a fire under the stock, a fire that will be stoked up over the next 4 months with constant news. BUT, a fire that is also being dampened by Canadian entities intent on accumulating sock from scaredy-cat Aussie holders. The TSX listing will start off from stock bought by Haywood here on the ASX & sold for a profit on the TSX. Dont expect any ballistics until that date! But after that they will stoke the fire to a roaring furnace, I guarantee you that!!

For those that are still accumulating, or want to get in, they have a window between now & the TSX listing to get in at these cheap prices. Some very interesting times ahead!

cheers

 

[Broadside]

kariba, I think the worst case scenario for this stock now (barring wider market meltdown which is out of anyone's control) is an opportunistic takeover. Probably won't happen but it must be vulnerable if we don't see significant appreciation soonish.

Question: given BMN shares directorships with Cazaly would this prejudice Rio Tinto against them? Rio would look a good fit for BMN but maybe CAZ history says otherwise.

The company with the best knowledge of BMN's potential and its likely cost structure would be the operator of Rossing itself.

 

[kariba]

smells like it was rushed to me, like when they talk of resource upgrade they talk only of new anomalies. why not say we havn't factored in the likely hot sediment material yet

Shag

I dont know what you are smelling, but it aint the same stuff I am!!

BMN have always been conservative in their reporting, yet you expect them to factor in mineralized metasediments that have only been found in ONE HOLE!!!

That would be:
a] Extremely foolish
b] Totally opposite to their standards

This is the most bullish we will get from them:

Whilst final annual production numbers will be borne out during the BFS, the expanding size of the resource and the likelihood that the previously reported overall resource grade of 219ppm under-states the expected final resource head-grade (due to surface depletion and the trend of increasing grade with depth) the Company has decided to target maximum production of ~4,000tpa U308 for a significant number of years at Goanikontes.

As to the scoping study being "rushed" and "vague" ... all I can say is you must be joking!!!

cheers

 

[Go Nuke]

Well we all know that they have the ability to expand their resource with all the other annomolies nearby that haven't been explored yet, keep that in mind.

I guess I was happy about the report, at least the sp went UP for a change with news rather than down like BMN usually does
Though Im not suprised to see the sp come down over the day. I think alot of people are still pretty pesimistic about Uranium and I predict that we could just see the share price move sideways for awhile... In fact I wouldn't be at all suprised if it went down further.

The U sentiment just hasn't really returned yet.

And yes DAZT49, im one of those people that topped up at $3.40ish and am still holding and paying off the interest on that mistake!
But long term I'm still very confident about Bannerman going into production and I too cant wait for the TSX listing to help the sp along.

 

[shag]

Shag

I dont know what you are smelling, but it aint the same stuff I am!!

BMN have always been conservative in their reporting, yet you expect them to factor in mineralized metasediments that have only been found in ONE HOLE!!!

That would be:
a] Extremely foolish
b] Totally opposite to their standards

This is the most bullish we will get from them:

Whilst final annual production numbers will be borne out during the BFS, the expanding size of the resource and the likelihood that the previously reported overall resource grade of 219ppm under-states the expected final resource head-grade (due to surface depletion and the trend of increasing grade with depth) the Company has decided to target maximum production of ~4,000tpa U308 for a significant number of years at Goanikontes.

As to the scoping study being "rushed" and "vague" ... all I can say is you must be joking!!!

cheers

i didnt say factor in i meant at least note it when talking of upscale potential for anomally a
they must have good feeling of whats down there, drilling is just one one source of info, drilling is obviously the best bar mining the thing obviously
i'd just like more info but it does seem theres alot of the stuff there in their tenent anyway
i've actually done one or two of these asessments in engineering geology, back in the dim ages tho
when is the canada listing



http://www.mineweb.com/mineweb/view/mineweb/en/page66?oid=27175&sn=Detail

 

[kariba]

i didnt say factor in i meant at least note it when talking of upscale potential for anomally a
they must have good feeling of whats down there, drilling is just one one source of info, drilling is obviously the best bar mining the thing obviously
i'd just like more info but it does seem theres alot of the stuff there in their tenent anyway
i've actually done one or two of these asessments in engineering geology, back in the dim ages tho
when is the canada listing

Knowing their past form, I am not surprised that havent touched on this in the Scoping Study ... they will no doubt keep us informed as it unfolds

The TSX listing was last mentioned as late Oct ... should be our next piece of news

cheers

 

[Sean K]

Technically, we're at an important juncture IMO. It needs to hold above these two old resistance lines (now support - in blue) and make its way through resistance between $2.50 and $2.75. I'd expect some consolidation here because of this, and anticipate the new support to hold, but who knows with this yo yo market.

 

[DAZT49]

kennas,
Nice to see it above that long term downtrend line.
Heres one of my triangles, taking into account last three days (including today to this point.)
Resistance $2.50 ,rising lows, falling volumes= breakout to height of the triangle. Gives a rise to $2.68.
All IMO of course.
cjheers
daz

 

[shag]

LOL

Daz, your expectations are way too high!!! IMO it did start a fire under the stock, a fire that will be stoked up over the next 4 months with constant news. BUT, a fire that is also being dampened by Canadian entities intent on accumulating sock from scaredy-cat Aussie holders. The TSX listing will start off from stock bought by Haywood here on the ASX & sold for a profit on the TSX. Dont expect any ballistics until that date! But after that they will stoke the fire to a roaring furnace, I guarantee you that!!

For those that are still accumulating, or want to get in, they have a window between now & the TSX listing to get in at these cheap prices. Some very interesting times ahead!

cheers

bl..dy fires gone out totally today
such a good day on rest bhp breaking 40, pdn past 7 again
bmn nothing
i'll wait, but i hope they find some more wood or better, coal for that furnace....
ps kennas what do u think of pdn, i'm still holding base shares plus warrants obviously....broken out like agm......
cheers shag

 

[DAZT49]

shag,
when the DOW went up 340points o/night I thought BMN would get sucked along with it. ASX200 up 163points too. As you say BHP,PDN etc etc all up.
BMN sitting on its hands
That big gap opening on Monday really is starting to hurt, IMO tomorrow will be lower again, maybe back to the oldish $2.25 support level.

 

[BSD]

I know that many disagree, but having run some numbers based on the Scoping Study - I still think BMN is fully valued at current levels.

It has many appealing features, but the upside value associated with the optionality on future expansion is so-far in the future, only a takeover would appear to me to provide a real boost to the share price.

The reality of a 2011 production date is setting in.

I used a minelife U308 price of $60lb and didnt get an NPV above $3.

A company with so much to do should trade at a substantial discount to NAV.

Good company - too expensive.

 

[kariba]

The reality of a 2011 production date is setting in.

I used a minelife U308 price of $60lb and didnt get an NPV above $3.

A company with so much to do should trade at a substantial discount to NAV.

Good company - too expensive.

You're right BSD, I pretty much disagree with everything you say!

I used a minelife U308 price of $60lb and didnt get an NPV above $3..

So lets see:

Base case 6,612,000 lbs p/a production
(3000t) @ A$68.00 p/lb = A$449,616,000.00 p/a
minus costs @ A$31.00 p/lb = $204,972,000.00 p/a
That makes annual profit of = $244,644,000.00 p/a

And with 150,000,000 shares you come up with NPV of $3

 

[BSD]

If you think BMN will have 150m shares on issue at production after financing a $400m capex bill and a BFS you will certainly be able to get something exceeding $3.

But you may also be deluding yourself.

I would also hazard using the quoted capex and operating costs in any conservative model.

I used a 15% discount for safety too.

Even if I got an NPV of $5.00 - I wouldn't pay more than $2.50 at such an early stage.

What % of NAV do you think BMN should trade at as an unfinanced, pre-feasibility stage project in Namibia?

 

[drmb]

Even if I got an NPV of $5.00 - I wouldn't pay more than $2.50 at such an early stage.

You wouldn't, but it seems that there may be others who will! The U spot has apaprently gone down to 85/lb but I think with what is gearing up next year plus reports in Carmichaels, Huntleys, and FP, many otehrs may pay more. See also my posting on Uranium re the articles in last weeks The economist. Each to his own!

 

[BSD]

You wouldn't, but it seems that there may be others who will! The U spot has apaprently gone down to 85/lb but I think with what is gearing up next year plus reports in Carmichaels, Huntleys, and FP, many otehrs may pay more. See also my posting on Uranium re the articles in last weeks The economist. Each to his own!

Exactly and well they might.

Just giving my interpretation as to why this stock isn't living up to the expectations of some on this thread.

I would also add that Carmichaels, Huntley and Fat Prophets aren't exactly market-moving investment houses.

 

[kariba]

If you think BMN will have 150m shares on issue at production after financing a $400m capex bill and a BFS you will certainly be able to get something exceeding $3.

But you may also be deluding yourself.

I would also hazard using the quoted capex and operating costs in any conservative model.

I used a 15% discount for safety too.

Even if I got an NPV of $5.00 - I wouldn't pay more than $2.50 at such an early stage.

What % of NAV do you think BMN should trade at as an unfinanced, pre-feasibility stage project in Namibia?

LOL

Of course they will have more shares on issue ... thats a given. But we are talking about their value NOW

In regard to operating costs, the figure of $27 is BASE CASE ... the company is starting conservative & state that 3 further initiatives will reduce that to $24 p/lb and further ... also the 3000t is BASE CASE ... the target is 4000t ... AND, then to have a phase 2 increase of production via modular processing

And yes you are right ... once Haywood have finished their current capping & buy-up of Aussie stock for TSX listing .. you definately WONT be paying $2.50 a share ... you'll need to fork out a hell of a lot more!!

But by then it will definately be too dear for you

No ... best bet is to just leave BMN alone I reckon

 

[doctorj]

Of course they will have more shares on issue ... thats a given. But we are talking about their value NOW

Sorry, that's bollocks. I don't mean to sound abrupt, but that post was disappointing in that it was far below the (high) standard you've set yourself until now.

You can't value the revenue stream of a project without considering how it's financed. We know that its going to cost around $400m (or more) in capex - either they raise it by debt or equity, either way will have an impact on valuation. You have to consider how they'll fund capex and factor it on or you're only looking at half the picture.

 

[doctorj]

FWIW, I thought I'd paste my quick and dirty model. At the moment, the NPV you get out depends largely on the grade and uranium price...

My matrix model (will post if anyone is interested) gives a NPV/Share of between $0.83 and $11.20 per share depending on which grade and uranium price you use within the range. The median NPV/share is $5.72 and the average is $5.80.

It uses the following assumptions:

Production
Opex 27.18 per lb
Capex 400,000,000
Recovery 90%
Life 12 years
Mill Throughput 15,000,000 tpa
Grade Min 219 ppm
Grade Max 300 ppm
Uranium Price Min $50 /lb
Uranium Price Max $100 /lb

Model Assumptions
Discount Rate 15%
Shares on Issue 150,000,000
Safety Margin 15%
Issue Price $3.00
Exchange Rate $0.85
Company Tax 30%
Depreciation Charge 8.33% (based on 1/mine life)

It currently assumes the capex will be raised 100% by equity and does not currently allow for royalties (if any... I'm not sure what they are).

 

[shag]

our fat profits have done the usual wrightup this week. don't call it a buy, just gloat on how cheap they suggested buying in at, way back in the dim ages.
do talk slightly interesting talk of reource upgrade in anomally a of 130mlb plus, and just one of several similar groups as we all know by now.